Cycle Trading

[No-Quarter]

There is much information contained here -

https://www.zerohedge.com/markets/liquidity-tsunami-foiled-why-has-major-implications-markets

The bottom line is -

As Wrightson ICAP economist Lou Crandall writes this morning, as Congress gets closer to passing a $1.9 trillion of stimulus, the Treasury won’t need to raise much new money to finance the plan. "This also means that the government’s cash surplus problem is about to resolve itself."

And since there will no longer be a flood of liquidity that dealers will have to absorb, it also means that there will be far more capacity for regular coupon securities. In short: a flattening of the curve is imminent, as are lower 10Y yields... and by extension higher stock prices as this move will likely be viewed (incorrectly) by algos and quants as a disinflationary trade.

A little voice in me is saying it was planned to be this way...